According to the textbook, demand and supply determine prices, and prices allocate scarce resources in the economy.

Technological improvements are more likely to occur if

A) the economy is centrally planned. B) economic decisions are made by politicians rather than entrepreneurs. C) entrepreneurs are compensated with higher profits for taking risks. D) companies face little competition in their markets.

Policies to encourage higher personal saving rates include ________

A) lowering income taxes B) lowering sales taxes C) increasing the quantity of money D) raising asset prices E) reducing interest rates